February 20, 2005

Competing with WM by Moving Closer

This guy's strategy worked for a while, at least:

After Wal-Mart came to his town, Tom Reed of Reed's Appliances hit on a surprising business strategy: He moved from downtown Lapeer and set up shop across the street from the retail giant.

"I did it for the uptick in traffic," Reed said. "And I wasn't really competing with Wal-Mart because their (electronic) appliances were low-end and mine are high-end."

But Reed didn't anticipate Wal-Mart razing its store and building a supercenter on the same site. Open since November, the Super Wal-Mart has already hurt the electronics part of his business, Reed said.

"Now, they're carrying the same equipment I do."

So how can a puny David compete with an ever-changing, ever-mightier Goliath?

The rest of the article is superb. Most important is how downtowns are actually changing:
Downtowns aren't necessarily dying, but Wal-Mart and other large retailers are forcing them to transform, said Amy Connolly, director of Howell's Downtown Development Authority.

"Significant categories of businesses are no longer represented downtown: drugstores, small electronics stores, hardware stores and groceries," she said.

Posted by Kevin on February, 20 2005 at 03:11 PM